Entergy Proposes to Join MISO Control Area

By November 2, 2011 News

Entergy, the parent company of several regional electricity utilities in the southeast United States, is proposing to join the Midwest Independent System Operator’s (MISO) control area over the next several years. Entergy’s operating companies own and operate the electricity grid in large parts of Louisiana, Arkansas, and Mississippi, as well as east Texas.

The goal of the move would be to lower costs for its regulated utility customers through more efficient dispatch of generation resources and lower administrative costs than it currently has through a somewhat similar relationship with Southwest Power Pool (SPP). Entergy’s initial analysis projected $1.4 to $1.6 billion in production cost savings (which basically means lower generation costs) and an additional $150 million in administrative cost savings over the period from 2013 to 2022. While this will not result in substantial cost reductions to individual customers, it may pave the way for a competitive generation service program for large commercial and industrial customers. It will have a potentially significant impact to industrial customers who own and operate co-generation facilities, as these facilities in the past have sold their excess electricity to Entergy at prescribed rates and would be subject to market forces if Entergy joins MISO.

Entergy will need to seek approval from the Federal Energy Regulatory Commission (FERC) as well as the public utility commission in each state it operates and the city council of New Orleans. This process is expected to take several years and could result in changes to the proposed plan to join MISO.